Glossary
TVL
Total Value Locked — the total value of assets deposited in a protocol's contracts.
Total value locked is the sum of all assets deposited in a protocol's contracts. It is the standard measure of size in DeFi, and it is easy to misread.
TVL counts the dollar value of deposits, so it rises when prices rise even if no new money arrives. It can also be inflated by recursive lending loops where the same capital is counted several times. Treat it as a rough size indicator, not proof of health.
Related terms
Airdrop
Free tokens distributed to wallet addresses, usually to reward early users of a protocol.
AMM
Automated Market Maker — a protocol that prices assets with a formula instead of an order book.
APR vs APY
APR is the yearly rate without compounding; APY includes compounding and is always higher.
ATH
All-Time High — the highest price an asset has ever traded at.
Bear Market
A prolonged decline, conventionally 20% or more from recent highs.
Bull Market
A prolonged rise driven by new demand, easy credit and rising confidence.